In the Microsoft world of .NET datasets were originally set up to help ease the translation of data, but eventually turned into more problems. The reason being is that there is nowhere to place business rules in datasets, which is not the case in business objects. This is critical if your company is passing off data between different systems and databases and there is no common language or platform to make the exchange. While cost may be slightlt higher to create business objects the maintenance costs will more than make up the difference.
A great article from Kellerman Software 
on the subject and provides a great viewpoint on the pros and cons of using business objects over datasets.
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